Financial system stability

The 2008 financial crisis was a sobering lesson that brought the extensive damage which weak financial systems could inflict into stark focus. It had also unleashed an unprecedented global regulatory response, the more significant elements being the Basel III reforms that recalibrated rules on the quality and quantity of capital, along with new requirements on liquidity and financial leverage. DBS understands that its financial strength has important implications on the overall macroeconomic stability of its key markets, and generates externalities beyond the immediate commercial interests of its stakeholders. As such, we have always adhered to the spirit of the prudential objectives underpinning the regulations we observe: reflecting our regulatory philosophy, it is noteworthy that DBS is already in compliance with the Basel III capital and liquidity requirements well before the transition schedules specified by the Basel Committee on Banking Supervision, and is well-positioned to comply with the forthcoming leverage ratio.

Aside from prudential concerns, what the financial crisis had also made apparent were financial misconduct and market manipulation activities. Such erroneous behavior is the precipitate of weak governance and a misaligned incentive structure. At DBS, we address these issues at the root, consciously nurturing a corporate mindset and remuneration philosophy that collectively reinforces a culture anchored on a belief in responsible and fair financial intermediation. This governs how we interact with our banking counterparties and customers.

We remain vigilant in identifying, monitoring and managing emerging threats that could impact financial stability, and regularly engage our regulators in dialogue on developing issues. In response to the heightened risk of cyber attacks, we have strengthened our cyber security framework, controls and surveillance. Another area where we have devoted additional resources is the mitigation of financial crime risk.

Strong compliance culture

Our compliance culture is anchored on transparency, responsiveness and an emphasis on respecting both the letter and spirit of the law and regulations in the countries we operate in.

Frequent interaction with regulators facilitate effective information exchange, allowing us to hear prudential concerns while keeping regulators updated on DBS' strategies and priorities. The chairmen of the Audit Committee and Board Risk Management Committee, who are both independent Directors, also attend meetings with our regulators periodically to share their views and insights. We participate actively in supervisory college meetings involving supervisors in the region where DBS has sizeable operations. These meetings provide a forum for the Monetary Authority of Singapore and host supervisors to exchange views and assessments of DBS' cross-border activities.

Credible industry leader playing pivotal role in shaping development of policies

Members of our senior management team are actively engaged in regulatory and industry forums. We believe our insights from operating in the region can contribute to the formulation of robust prudential rules and regulations.

DBS hosted the 2014 International Institute of Finance (IIF) Asia-Pacific CEO Summit, which was held for the first time in Singapore. This event brought together senior executives, officials and financial experts to discuss pertinent issues impacting Asian financial players, ranging from the health of Asian markets to the implications of the global regulatory reform agenda on Asia. The highlight was an illuminating dialogue between Mr Piyush Gupta (CEO) and Deputy Prime Minister Tharman Shanmugaratnam, centred on the opportunities and challenges facing the region. Our CEO (also a director of IIF) called for an Asian voice in global rule-setting forums and a regional platform to be created for closer co-operation between the private sector and regulators.

Back to top